Maintain short positions. The FCPO staged a positive intraday price reversal in the latest trading session. The rebound set in after the commodity tested the 100-day SMA line with a low of MYR2,635. At the close, it settled MYR14 higher at MYR2,709. Despite the positive reaction from the said SMA line, at this juncture, it is still inconclusive to suggest the commodity’s retracement – which resumed on the failed attempt to cross above the 50-day SMA line on 6 Feb – has come to an end. Hence, we keep to our negative trading bias.

Until a positive price reversal is confirmed, we recommend that traders remain in short positions. We initiated these at MYR2,695, the closing level of 11 Feb. For risk management purposes, a stop-loss can be placed above MYR2,780.

The immediate support is revised to MYR2,665, derived from the latest candle. This is followed by MYR2,626, derived from 4 Feb’s candle. Meanwhile, the immediate resistance is pegged at MYR2,725 followed by MYR2,780 – both are derived from 11 Feb’s candle.

Source: RHB Securities Research - 13 Feb 2020